Europe's cookie crisis is a tax on entrepreneurship

Five clicks, three toggles, and two scrolls—all before a potential customer can even see a merchant's products. This is the daily reality for millions of European shoppers, forced to navigate an obstacle course of consent pop-ups with every new website they visit.

“We lose about 10% of potential customers the moment our cookie banner appears,” says Artur Wagner, Chief Digital Officer at German leather goods brand BRAUN BÜFFEL. “It's like placing a 'Do Not Enter' sign on your digital storefront.”

Cookie banners—user consent pop-ups triggered by the EU's ePrivacy Directive and GDPR—have transformed from a well-intentioned privacy safeguard into a costly burden that disproportionately penalizes small businesses. Bureaucracy is no longer just slowing the browsing experience. It's become a significant drag on Europe's digital competitiveness.

Today, Europeans spend an estimated 575 million hours per year clicking through cookie banners. Economically, this translates into €14.375 billion in lost productivity annually. 

For business owners, this isn’t a minor inconvenience. It’s a barrier to survival.

How regulation became repression

Europe’s small and medium-sized enterprises (SMEs)—the backbone of its economy, accounting for 99.8% of all enterprises in the EU—bear a disproportionate share of compliance burdens. 

“Five years ago, 10% of users rejected cookies. Today, it's 50%,” says Artur. “These shoppers lose access to essential features like search functions, personalization, and even basic filters.”

The consequences are measurable: Braun Büffel reports conversion rates 50% higher among cookie-accepting users. “Customers who decline cookies later contact us wondering why they can't use wishlists or personalization—not realizing their own choices disabled these functions,” says Artur.

Large businesses with a high volume of repeat visitors can amortize the technical cost of cookie compliance and streamline consent flows, reducing banner fatigue and minimizing friction. Smaller businesses, by contrast, must repeatedly prompt visitors with banners, even for routine functionalities. This creates a dual burden of high implementation costs and a degraded experience for customers. The result is a regulatory framework that favors digital incumbents and frustrates smaller players.

“Cookie banners, although being added to give control to the user, seem to be more of an annoyance for end-users,” says Klavs Steenhof, Head of Digital at INTERSPORT, “and add friction to the fluent cross-channel buying-experience we all want to give our customers.”

Data shows that GDPR compliance has already reduced profits for European businesses by an average of 8.1%, with SMEs seeing an even sharper decline at 8.5%. In the technology sector, small firms have seen profits fall by 12.5%, while the profits of large platforms have remained relatively unaffected.

Cookie banners are no longer just about compliance—they are an economic drag, entrenching advantages for the largest players and choking the agility that SMEs rely on.

The case for reform: smarter rules, stronger outcomes

Privacy matters. But so does Europe’s ability to innovate. A balanced, modernized regulatory approach can protect user rights without crushing the small businesses that power our digital economy. 

As the EU moves ahead with its Digital Omnibus simplification package, lawmakers have a concrete opportunity to modernize cookie and consent rules to reduce banner fatigue while safeguarding fundamental rights.

Reforms should focus on:

• Exempting low-risk use cases to reduce fatigue and burden. Introducing clear exemptions for low-risk tracking, such as technical and basic analytics cookies would reduce banner fatigue for users and lower compliance burdens—especially for small businesses—while still maintaining strong privacy protections.
• Harmonizing and simplifying consent requirements. Establishing uniform definitions and consent rules across all EU member states would make opt-in mechanisms less painful to implement for businesses and less frustrating for users to interact with.
• Enabling global consent options. A simplified and unified framework can open opportunities for global consent mechanisms that give users more control and eliminate the need for repetitive prompts.

A European model that works for everyone

Shopify already provides merchants with automated privacy tools, such as country-specific cookie banners, to help them comply with complex rules. This reduces technical complexity and burden, but does not address the user fatigue and disadvantage.

At a policy level, Germany is a case study that should serve as a model for the rest of the EU. To better balance user control and business clarity the TTDSG (Telecommunications and Telemedia Data Protection Act) worked to streamline consent practices and clarify exemptions.

The EU now has a chance to build on these efforts to establish a coherent, SME-friendly framework that supports both privacy and innovation across the EU.

The opportunity to lead

Europe’s SMEs are already navigating rising costs, trade fragmentation, and macroeconomic volatility. In this fragile context, overregulation acts as a self-inflicted barrier to competitiveness. But it doesn’t have to be this way.

“Cookie banners in their current state add friction to the customer journey,” says Cem Dogan, founder and CEO of VEYNOU. “Europe needs smarter rules that protect privacy without impacting a seamless customer experience, especially in sectors like luxury where details matter.”

By reforming cookie rules through the EU’s Digital Omnibus simplification package, EU lawmakers can unlock billions in productivity, ease the burden on small businesses, and ensure its digital economy remains open, innovative, and competitive.

Because behind every unnecessary cookie banner is a lost sale, a lost customer—and ultimately, a lost opportunity.

Europe’s entrepreneurs can’t afford to wait.